December 30, 2012

In April, the three largest unions at American Airlines announced they had signed conditional labor agreements with US Airways, publicly throwing their support behind a potential merger between the two carriers.

The news came a few weeks after American had filed court motions to reject all of its labor contracts in favor of cost-cutting proposals.

In a joint statement, the leaders of the Allied Pilots Association, the Association of Professional Flight Attendants and the Transport Workers Union, said they believed a merger with US Airways offered a better chance for success than an independent American.

"As envisioned, a merger of US Airways and American Airlines provides the best path for all constituencies, including employees of both American Airlines and US Airways," the unions said. "The contemplated merger would be based on growth, preserve at least 6,200 American Airlines jobs that would be furloughed under the company's standalone strategy and provide employees of both American and US Airways with competitive, industry-standard compensation and benefits."

The informal agreements with US Airways put pressure on American's management to negotiate deals with its unions that were not as drastic in cost-cutting as its previous proposals. And with all three unions with seats on the Unsecured Creditors Committee, it made the committee seriously consider US Airways' merger proposal.

In August, US Airways signed a non-disclosure agreement with American to begin sharing information for a possible merger. And even though the three unions have signed new contracts with American, they still publicly support a merger.